Education Pays: Income by Education Level (2012 Data Update)

Education seems like it’s the answer to everything in the United States. When it comes to social problems or individual opportunity, we place an enormous amount of faith in education to cure what ails us. Given all the time and money we invest, especially as students, we hope that the payoff will be worth it.

The good news for students hoping that more education leads to higher incomes is that recent data from the U.S. Census Bureau demonstrates a strong positive correlation: as educational level goes up, median income also rises.

A New York Times article by David Leonhardt, “Is College Worth It? Clearly, New Data Say” reaches a similar conclusion. Leonhardt reports that the difference in income between those with a high school degree and those with a college degree has risen steadily.

Leonhardt provides a number of useful links to studies analyzing the correlation. In reference to one of them he writes:

The much-discussed cost of college doesn’t change this fact. According to a paper by Mr. Autor published Thursday in the journal Science, the true cost of a college degree is about negative $500,000. That’s right: Over the long run, college is cheaper than free. Not going to college will cost you about half a million dollars.